Jagged Peak, Inc. (fka JGPK)

[Drill Baby]

With commission selling for ~$0.35 per share - not too bright!

[Drill Baby]

I wonder who is dumb enough to sell 38 shares at 0.56/share and pay $7.95 plus in commission?

[poggie]

Slow going I no longer have to worry about short term capital gains.

[10 bagger]

New Application Instantly Calculates Relationship between Improved Service Delivery and Cost TAMPA, Fla., April 6, 2015 /PRNewswire/ -- Jagged Peak, Inc. (OTC BB: JGPK), a leading provider of enterprise-class eCommerce solutions and fulfillment services, will demonstrate its newest tool, Slick(TM) at the Home Delivery show this week in Atlanta, GA. Jagged Peak developed Slick, a service level improvement cost calculator, to help companies analyze the correlation between shipping costs, delivery time and service improvement. "Most companies we engage with want to improve the level of service they are providing their customers," says Dan Furlong, COO of Jagged Peak. "The challenge has always been providing them with an instant assessment of the cost impact to improve service levels across various scenarios. With Slick we can instantly calculate and display to our clients the total and average cost per order to upgrade a given percentage of orders from 2 day to next day delivery, as an example." "Transportation accounts for the greatest portion of fulfillment costs," said Michael Mercier, President of Jagged Peak. "Slick(TM) provides us and our clients with instant, accurate information to make intelligent business decisions that define how to best invest freight spend and achieve the maximum return. That's significant and provides us with a real competitive advantage in the marketplace." Slick(TM) represents the latest technology tool added to Jagged Peak's growing arsenal of information technologies designed to help companies optimize their order fulfillment programs. Jagged Peak's FlexNet(TM) fulfillment network is a multi-distribution center solution now comprised of 25 fulfillment locations across the U.S. and Canada. In September of 2014, Jagged Peak added Europe to the markets served with a fulfillment provider in North Hampton, UK. In Q4 of 2015, the company plans to offer APAC fulfillment capabilities through a strategic partnership with a Singapore based Logistics Company. "Last year, approximately 92% of our customer orders were delivered next day utilizing ground service. By 2016, we plan to deliver more than 50% of eCommerce orders, same day. Its tools and services like Slick(TM) and FlexNet(TM) that will help us achieve this high value fulfillment solution," said Vince Fabrizzi, Chief Sales and Marketing Officer of Jagged Peak. About Jagged Peak Jagged Peak is an eCommerce solutions provider with software and services that enhance the scalability, flexibility and profitability of omnichannel businesses. Its full-featured eCommerce Platform (ECP) and robust Order Management System (OMS) can be deployed alone or with a Warehouse Management System (WMS) and Transportation Management System (TMS) to form a shop-to-ship, web-based software suite that integrates the entire order life cycle with visibility across business units, distribution channels and trading partners. Media Contact: Kristine Bowman Director of Marketing Jagged Peak [e-mail] Photo - http://photos.prnewswire.com/prnh/20150403/196552 To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/jagged-peak-unveils-slick-at-home-delivery-show-300061011.html SOURCE Jagged Peak, Inc. /Web site: http://www.jaggedpeak.com (END) Dow Jones Newswires

[Drill Baby]

Really good revenue growth of 30 percent. ~$62 million sales times 3 (peer group) is $186 million value whereas it's current market value is ~$10.5 million - huge difference.

This seems to be the Ecommerce model - grow revenue as fast as possible then focus on earnings.

I am pleased with the continued revenue growth and the infrastructure investments.

[toddski]

Gov. Scott thanks Tampa e-commerce company for 35 jobs in four years:

http://www.bizjournals.com/tampabay/news/2015/03/05/gov-scott-thanks-tampa-e-commerce-company-for-35.html

[toddski]

Yeah definitely, thanks for the posting that. Like you said it's like another tool to help you provide a good logical framework for sizing your positions. I'll have to read up on this some more.

Certainly impressed with the allocations you are coming up with.

[Drill Baby]

Intrinsic Value $1.50/share (conservative)
10% probability

Middle Value $1.08
80% probability ($1.5+$0.65)/2

Bankrupt $0
10% probability (I used a really conservative high number since JGPK's Z score places this at close to zero)

Edge or expected value = $0.36

Odds or Possible gain = $0.43

Recommended election is 85% or conservative 1/2 is 42% of your portfolio.

Pretty high allocation numbers. The Kelly investment formula optimizes your capital growth rate. It is used by Bill Gross and other famous investors. Like most models, there are assumptions so.... it's only as good as your inputs.

Example for Apple:
http://www.oldschoolvalue.com/blog/investing-strategy/kelly-criterion-investing-portfolio-sizing/

I think these models (along with common sense) provide a good logical framework for investing.

[toddski]

Interesting, can you explain your take on the Kelly Criteria here?

Edge / Odds = Fraction of capital that should be allocated

[Drill Baby]

I am really enjoying the great JGPK bargains!! No matter how I look at the business, it's worth many multiples of its current price.

For all investors that need money now, please sell!!

I am reading a book that compares portfolio theory to the Kelly criteria of investing. The key issue is what is the best way to optimally allocate capital. I am more in the Kelly camp.

[toddski]

Thoughts?

[Drill Baby]

Interesting, thanks.

[toddski]

University of Tampa Journal of Business Case Study:

http://www.cluteinstitute.com/ojs/index.php/JBCS/article/viewFile/901/885

[toddski]

They are also hiring a financial analyst responsible for reporting finances. Could possibly be prepping for additional accounting needed for uplisting.

[Drill Baby]

I bought CVRR once it broke its 50/200 day moving average. It's intrinsic value is much higher than price. I also maintain a 10% (peak) trailing sale sell point.

[swampboots]

CRVV was a lottery buy Jan 12...MLP K form I dislike but interesting dividend hold.

[toddski]

Open position listings of 19 jobs shows encouraging growth. One job I like to see is the Staff Accountant for Revenue Billing:

https://jaggedpeak.applicantpro.com/jobs/178744.html

It could be back fill I suppose.

[Drill Baby]

Oil stocks long-term, I like BCEI, Carizzo, Continental, CRC, EOG, GPORT, CVRR (12% dividend).

All these stocks have a lot of potential with higher oil price. You will need to be able to withstand a lot of volatility. If you can't, no point in buying any of these.

[swampboots]

I like the EFT's for daily blood curling action but long term I am afraid of the natural "decay" in the myriad unknown ways they balance and just drop with same value dynamic of underlying entity as time goes on and I wind up chasing my tail?

[Drill Baby]

I like ETF XLE. I did own a bunch of energy stocks, but just owning the index is a lot less work/risk. I own a lot of stock in the company I work for so...

I was short oil price for awhile, made some money and liquidated most of the position when the market got disconnected from the fundamentals.

Right now the short-term price (up) is disconnected from the fundamental supply/demand. This is why:

http://m.fool.com/investing/general/2015/02/09/how-low-oil-prices-today-could-lead-to-a-big-futur

My guess is a year from now ( maybe sooner) oil price will be $70 plus per barrel.

[swampboots]

Any one oil play you are watchin that has money to buy cheap assets and grow faster if oil recovers in 2 years (70+)?

[Drill Baby]

Great, all the founders retired - others are running the business. Two of the founders just raised ~$500 million and are looking for fire-sale oil and gas properties. Once they do, if I like their purchases, I'll invest but have no interest in doing it again.

[toddski]

Excellent. I once found a very small oil gas company in college a couple years ago (bbi) black bird energy. Would have been a multi bagger I I had the money to buy some. Oh well gotta start sometime. How are they doing now?

[Drill Baby]

It became a $2 billion oil and gas company (peak) and started with a few very clueless guys with big dreams.

[toddski]

Are you at liberty to say what company you were publicizing?

[Drill Baby]

SPDC's financial don't look good. Also, Speed is involved in expensive litigation. In comparison, JGPK is a financially strong business growing at a high rate.

[toddski]

SPDC Speed Commerce down 46% today. Maybe they are losing business to JGPK.

[Drill Baby]

The book fortunes formula discusses the optimal trade allocation - the Kelly formula.

Essentially if your allocation is over 20% you better be pretty confident you understand why the market doesn't love your stock.

[toddski]

I agree with you on the liquidity issue. $10m for a company that has been compounding growth at 20%+ for years is difficult to find. Also just for fun if you plot the simple moving average and RSI on a 5 year chart, you will see that 90% of the time it is above the SMA and whenever the RSI dips below about 45 it is a great time to buy. Both of those indicators as well as the hopefully impressive Q4 numbers equate this to a strong buy imo.


http://finance.yahoo.com/echarts?s=JGPK+Interactive#%7B%22range%22%3A%225y%22%2C%22indicators%22%3A%7B%22sma%22%3A%5B%7B%22id%22%3A%22sma50%22%2C%22name%22%3A%22sma%22%2C%22params%22%3A%5B50%5D%2C%22lineType%22%3A%22line%22%2C%22color%22%3A%22%2338761d%22%2C%22weight%22%3A1%7D%5D%2C%22rsi%22%3A%5B%7B%22id%22%3A%22rsi14%22%2C%22name%22%3A%22rsi%22%2C%22params%22%3A%5B14%5D%2C%22lineType%22%3A%22line%22%2C%22color%22%3A%22%23cc4125%22%2C%22weight%22%3A1%7D%5D%7D%2C%22scale%22%3A%22linear%22%7D


One part I have a hard time agreeing with you on is your comment on how much to allocate to each stock. If you capped your limit at 5%, that means you would need to own 20 individual companies. I don't know about you but my sweet spot is less than 10, because it becomes difficult to track all of them. And if you do end up finding a multi-bagger, it won't make a dent in your portfolio because you never had enough money allocated to it. Especially for younger investors, I think it's important to swing hard and aim for the fences. With that said it's also important as you noted to invest in ETF's as well and imo that's what a 401k is for. Unless you were rich to begin with, but then you wouldn't be buying little companies like this.

[Drill Baby]

Good questions.

The only reason I invested in JGPK was because I think it's worth many multiples of its current price - large margin of safety. As discussed, JGPK's liquidity issue can be fixed - a better stock exchange, etc... E-commerce is hot and growing, etc..

I believe the stock market is priced high now - you can look at Shiller's CAPE, etc. And there are companies like Apple that have an intrinsic value much greater than current price. I believe there are good deals, but you have to really do your home work and look long-term. Buying individual companies carry additional risk over an ETF. I once bought an oil stock that looked unbelievable cheap. Well, come to find out all the accounting was made up. Luckily I didn't own much, and it taught me an important lesson - never place too much money (more than 5%) in any individual stock - look at Enron. Many stocks are cheap for a reason. Also, markets can be irrational for long periods of time.

Currently the supply of oil is way more than the demand, but oil prices in the last week are going up - deviating from supply/demand fundamentals. Why? Because traders not fundamentals are driving the market. People and market psychology drive markets, not math formulas - read the book when genius failed - a hedge fund bankrupted by a bunch of MIT PhDs and Nobel prize winners. Most hedge funds can't beat the S&P500 over a business cycle. You have to be a genius to copy Buffet, and need to know nothing to just buy an index fund from Vanguard. For 99% of people, the index is probably the way to go.

Why would anyone want to manage other people's money? I have friends earning $500K plus managing mutual funds, hedge funds, etc. Personally, it wasn't anything I was interested in.

[toddski]

Typically if you have to invest in indexes such as in your 401k, the VTI is your best bet with an expense ratio of .15%. However, why would you even bother throwing any money in these small caps if you believe that's the best/only way? Also, would you want to manage other people's money? I certainly would not.

[Drill Baby]

If you want to work managing people money it helps to be a certified financial planner (CFP) and/or a certified financial analyst (CFA).

While getting these designations like an MBA (finance) may not make you a better investor, in general you need them to get a job managing other people's money.

My 2 cents...

[Drill Baby]

I thing reading every book on Warren Buffet available helps. Ultimately, I think putting most of your money in balanced low cost ETFs and mutual funds is wise. I like vanguard life funds - set retirement date and the stock/bond ratio automatically re-balances.

Always important to remember, most mutual fund managers can't beat the market indexes.

[Drill Baby]

An MBA (finance) helps you better understand the WSJ Jargon. Understanding financial statements and valuation of businesses, I think is important - the fundamentals.

I listen to Moe Ansari's podcast daily. He has over 38 years of trading experience and he goes through his trading logic. I think having the right framework is critical, so your not overreacting (or trading) using data noise. Conversely, you should be reacting to meaningful movements in the market - not in the hold and hope mode - correctly interpreting the charts.

In the end, like most things in life, the best way to get better is to practice -using a nominal amount of money. In trading, being able to ignore your emotions is key.

Hopefully that helps.

[toddski]

From all the research I've done, an MBA will not make you a better investor. I'm happy with my position so far and don't really feel that a degree higher than BSME will be necessary. Plus that's more money for investing right?

[Drill Baby]

An MBA helps if your in your early thirties or late twenties.

If older, look for a good three plus class certificate program (finance) from a top school like Harvard, Stanford, Chicago,...

[Drill Baby]

Chemical engineer, MBA (Finance).

Oil and Gas Acquisitions, reservoir asset management. And most importantly, manage my investment portfolio. A few years ago, I took a private company public - road shows, etc. My real passion is finance, but didn't want to travel constantly.

[toddski]

What are you doing for a living now? I'm a mechanical engineer and invest/research as a side hobby. I would love to be able to do it full time some day.

[Drill Baby]

Yeah, I started my career as a commodity trader, so I know a lot about trading stocks, etc. I still trade some liquid securities... Why someone would try to day trade JGPK is beyond me. As stated many times, I think this company is really undervalued. I calculate just its US location network (without the software) is worth over $1 per share.

Looking forward to the next earnings release.

[toddski]

Oh ok, wish I could have picked those up. Still it seems as though people are trying to day trade this stock as you mentioned in the past. This should be a buy and hold long term as long as they keep performing.

[Drill Baby]

Yeah, someone most likely fat fingered the trade. I am just happy it wasn't me. Lol.

[toddski]

Hey what's with the trade at 15 cents today?

[Drill Baby]

March 18th is the next earnings announcement.

[Drill Baby]

This year, I am really hoping JGPK moves to the Nasdaq to increase shares outstanding, liquidity, and valuation metrics - going from less than $0.25 per sales to something closer to their peer group ~$3.00 per sales. This would place JGPK's share price ~$8.40.

I am amazed that some investors are trying to day trade JGPK - a stock that lacks liquidity due to only ~5 million shares outstanding. To me, either your in for a minimum of several years or you don't buy this type of stock.

Fingers crossed, looking forward to reading the 4th qtr financial statements!!

[Drill Baby]

Yes, I am really excited about all the opportunities and looking forward to seeing the 4th quarter financial statements.

[toddski]

From their latest 3Q 10Q:

Net cash used in the Company's investing activities totaled $2,448,000 for the 39-week period ended September 26, 2014 consisting of acquisition of warehouse equipment, computer hardware, and building improvements to the company owned warehouse in St. Petersburg and enhancements to the Company's software. The Company expects total capital expenditures during the fourth quarter of the year 2014 will be approximately $ 0.5 million to complete the new warehouse infrastructure and additional software enhancements.

Q2 10Q:

Net cash used in the Company’s investing activities totaled $1,772,500 for the 26-week period ended June 27, 2014 consisting of acquisition of warehouse equipment, computer hardware, and building improvements to the company owned warehouse in St. Petersburg and enhancements to the Company’s software. The Company expects total capital expenditures for the year 2014 will be approximately $2,000,000 to $2,500,000 to complete the new warehouse infrastructure and continued software enhancements.

It appears that 4Q net cash used in upgrading their warehouse and software will be substantially less than 3Q. Adding to that the 4th quarter being the seasonally best quarter for sales, it's looking pretty good.

[ZachBuffett]

Or a market maker playing games. The trading behavior has been interesting over the past month. We'll see what happens here with the upcoming filing- Q4s are always exciting here.

[Drill Baby]

5 shares sold 2 times... heee heee.

Someone needs a financial advisor!

[toddski]

It is odd. No big news until March earnings report. Sometimes people just need to sell. I'll be holding mine $1+

[swampboots]

More amazed got 6K same price after tax selling season?